Up Front
Cayman 'GoneClear' - removed from FATF's Blacklist
Cayman Islands government officials andoperators in the private sector are a much relieved group afterlearning that the country has been removedfrom the list of countriesdeemed non-cooperative in the fight against money laundering.
In June of last year, the Financial ActionTask Force (FATF), an arm of the world's rich nations group Organisationfor Economic Cooperation and Development (OECD), named the Caymanamong a number of other financial and tax-free jurisdictions withinsufficient laws aimed at fighting money laundering and threatenedputting out an advisory to its own institutions about dealingwith these labeled territories if things were not changed.
At a press conference held by the the Leaderof Government Business, the Hon. Kurt Tibbetts, withe other membersof Cayman's negotiating team, Mr. Tibbetts express satisfactionwith this decision by the FATF. However, he could not confirmwhat the FATF's sanctions could have been for Cayman, had theterritory not meet the FATF's 25-point criteria. It has also beensuggested that the addional cost for putting in place the requiredtechnical and staff support should be met jointly by the Governmentand the financial sector.
This could be quite an order for the Governmentwhich has had to arrange a loan of $65 million to meet its projectedshort fall of revenue for the current fiscal year. With the stateof the economy in a downturn, this figure could be escalated byas much as another $30 million.
Last year, the Cayman Islands, as the world'sfifth largest offshore financial centre, responded to the OECD/FATF'sdemands by introducing a series of laws and legal amendments tocover any perceived loopholes in the system and were rewardedwhen the FATF announced on Friday, 22 June that this country isamong only four jurisdictions found to have proper regulationsin place and their names were therefore taken off the list.
"The laws we have are designed to enableour authorities - and financial services providers - to continueto be effective in the
international fight against money laundering. We were well placedto fine-tune these due both to the compliance culture in our industryand to the comprehensive anti-money laundering provisions alreadyin place," said Mr. Tibbetts.
The Bahamas is the only other Caribbeancountry to have its name taken off what was generally regardedas a blacklist. The other two jurisdictions to have their namesremoved from the list are Panama and Liechtenstein.
Meanwhile, other jurisdictions to have beenadded to or remain on the list . They are Cook Islands; Dominica;Egypt; Guatemala; Hungary; Indonesia; Israel; Lebanon; MarshallIslands; Myanmar; Nauru; Nigeria; Niue; Philippines;Russia; St.Kitts and Nevis; and St. Vincent and the Grenadines.
"We are satisfied that the FATF hasrecognized our actions in response to the 25 evaluation criteriaintroduced in February 2000," said Hon. George McCarthy,Financial Secretary of the Cayman Islands. "As a major internationalfinancial centre, we are committed to ensuring that we keep pacewith international standards. We remain focused on the principles,and recognize that our regulatory authorities and financial servicesproviders must remain ever-vigilant."
The FATF said: "The Cayman Islandshas made important progress in terms of implementation of itsnew counter-money laundering regime. It has significantly increasedthe human and financial resources dedicated to
financial supervision and to its financial intelligence unit".
In April of this year, an FATF Review Groupof the Americas, visited here and they were responsible for producingthe progress report on the Cayman Islands, among other countries,by conducting an on-site visit and reported that this country'swas deemed compliant with the criteria used for evaluation.